The Government has turned down a proposal to by 20 new houses for its ministers.
The proposal to buy the houses to avoid further controversy over ministers' expenses was one of several given to Prime Minister John Key, The Dominion Post newspaper reported.
It would have cost millions and wasdismissed as it was not likely to be popular in the current economic environment.
Mr Key has ordered a review of the rules covering ministerial housing, saying they were arcane and did not deliver the best results.
He was, however, still backing members of his cabinet who have been under scrutiny for their accommodation claims.
He did not believe any have taken advantage of their circumstances.
Questions have been raised since details of MPs' travel and accommodation expenses were released, particularly about the taxpayer contribution of nearly $1000 a week for Deputy Prime Minister Bill English to live in his million-dollar Wellington home.
English has said he would pay back all of housing allowance he has received above that of an ordinary MP.
Mr English said no amount of detail about how he received almost $1000 a week in expenses, including $700 in rent, would change the perception than he was getting a bigger allowance than others.
